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The Oregon Administrative Rules contain OARs filed through June 15, 2014
 
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OREGON BUSINESS DEVELOPMENT DEPARTMENT

 

DIVISION 690

LONG-TERM RURAL ENTERPRISE ZONE INCENTIVES

NOTE: Department of Revenue forms referenced in this division are available from the Department of Revenue, Property Tax Division, 955 Center St NE, PO Box 14380, Salem OR 97309-5075, phone 503-378-4988, 800-356-4222, TTY 800-886-7204, fax 503-945-8737, and web http://www.oregon.gov/DOR/PTD/enterform.shtml

123-690-0001

Purpose and Scope

This division of administrative rules specifies the effect of provisions under ORS 285C.400 to 285C.420 and 317.124 to 317.131. As such, these administrative rules:

(1) Address determinations, procedures and requirements of the up to 15 years of exemption from property taxes and of corporate excise tax credits on a qualifying investment inside a rural enterprise zone in a county experiencing particular economic hardship.

(2) Do not control fiscal parameters of the county assessor or the Department of Revenue, and they do not supersede administrative rules in OAR chapter 150 for any such purpose.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.400 - 285C.420 & 317.124 - 317.131
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-0100

Terminology

OAR 123-001 (Procedural Rules) contains definitions that are used in this division of administrative rules, unless the context dictates otherwise. In addition, as used in ORS 285C.400 to 285C.420 and 317.124 to 317.131:

(1) “Facility” or “facility site” encompasses the following:

(a) A building or structure, or group of two or more associated buildings and/or structures newly constructed beginning after the application for certification, and located at a common site or proximately adjacent sites entirely inside the boundary of a single rural enterprise zone.

(b) New additions or modifications occurring entirely after the application for certification to any previously constructed or occupied building or structure as otherwise described in subsection (a) of this section.

(c) All of the real or personal property located at the site, whether or not it is inside or on a building or structure, as described in subsection (a) or (b) of this section, if newly installed after the application for certification. (Excluded is any vehicle, as well as device pulled, pushed or carried by a vehicle, that is designed to hold and transport people, goods or property on highways, waterways or railways beyond the zone boundary, including but not limited to aircraft, barges, carriages, railcars, trailers, trucks or ships)

(d) Any property leased by the business firm certified to receive the exemption under ORS 285C.409 and otherwise described in this section, but only if the firm is fully responsible for and pays all applicable ad valorem taxes potentially levied on such leased property through explicit provisions of the lease agreement.

(e) The entire category of property in subsection (a), (b), (c) or (d) of this section, unless in first claiming the exemption under ORS 285C.409(1)(a) or (c), the certified business firm formally and irreversibly excludes all property in any such category, as might be agreed to under ORS 285C.403(3)(c) with the zone sponsor.

(2) “In service” has the meaning described in OAR 150-285C.409, based on issuance of a final certificate of occupancy for the facility by local permitting authority (regardless of the definition under ORS 285C.050 as used for the exemption under ORS 285C.175).

(3) “Sponsor” or “zone sponsor” has the same meaning as described in OAR 123-668, in that all cosponsors of the zone shall jointly approve or exercise any and all actions under ORS 285C.400 to 285C.420 and 317.124 to 317.131, except for the particular adoption of a resolution as required under ORS 285C.403(3)(a).

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.400 - 285C.420 & 317.124 - 317.131
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-0500

Eligible Rural Enterprise Zones

In determining annually if a county conforms to the definition under ORS 285C.400(3) of a ‘county with chronically low income or chronic unemployment’:

(1) With formal release, publication and availability of benchmarked annual unemployment rates for the previous year and other relevant data, the Department shall analyze these data, along with the most recently revised data available for other relevant prior years, and ascertain which counties in the state satisfy the definition.

(2) The Department shall identify any existing rural enterprise zone in those counties, preparing maps or other such information as feasible and appropriate for use by the public and business firms, as well as respective local zone managers and county assessors.

(3) The official determination as described in this rule shall first take effect on July 1 next following formal availability of the latest relevant annual data and shall apply until and including June 30 of the next calendar year, excepting for section (5) of this rule.

(4) Fulfillment of subsection (d), (e) or (f) of this section achieve conformance, such that as used in ORS 285C.400(3):

(a) “Most recently revised annual average unemployment rate . . . available” means the estimated percent of the civilian labor force that is unemployed on average for the entire previous calendar year and other relevant prior years, as benchmarked and published by the Employment Department in cooperation with the United States Bureau of Labor Statistics.

(b) “Most recently revised . . . annual per capita income levels available” means the average annual per capita personal income level as published and revised by the Bureau of Economic Analysis of the United States Department of Commerce for the most recent calendar years available.

(c) “Median ratio . . . of the county to the equivalent of the entire United States for each year” means the average for the two middlemost quotients that result from dividing the county figures described in subsection (a) or (b) of this section by each year’s corresponding national figure over 10 or 20 years.

(d) “Equal to or less than 0.75 over the last 10 years” means the median derived per subsection (c) of this section for the most recent 10 consecutive years, based on figures described in subsection (b) of this section, is equal to or less than 0.75 rounded to the nearest hundredth.

(e) “At least 1.3 over the last 20 years or over the last 10 years” means the median derived per subsection (c) of this section for the most recent 20 or 10 consecutive years, based on figures described in subsection (a) of this section, is not less than 1.3 rounded to the nearest tenth in one or both cases.

(f) “Negative net migration” means the county’s change in total population minus natural population change is equal to or less than negative one (-1), based on the most recent estimates available from the Portland State University Population Research Center, in comparison to the latest official decennial population count by the U.S. Census Bureau at least three years prior.

(5) During the course of the year from July 1 to June 30, if the Department learns of an official revision or correction to relevant annual data, the Department shall review such revised data to determine whether it would alter the status of any county. For any consequent change to the counties currently identified by this rule:

(a) The effective date of any such change shall be the first day of the second month following the month in which the revised or corrected data were formally released or published; and

(b) The Department shall notify affected county assessors and local zone managers and may revise and reissue relevant lists, maps and other materials, as appropriate.

(6) A correct, prior determination in accordance with this rule is not subject to retroactive change due to revisions in future years.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.400 & 285C.403
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

Local Approval of Facility Exemption

123-690-2000

Written Agreement

For purposes of the written agreement between a business firm and the sponsor of the rural enterprise zone under ORS 285C.403(3)(c) and (d):

(1) The agreement shall consist at a minimum of the following:

(a) Acknowledgment of the planned or pending application for certification under ORS 285C.403(1) and (2);

(b) Concise description of the firm’s proposed investments, facility and workforce;

(c) Specification of the obligations that the proposed investments, facility and workforce must satisfy under ORS 285C.412, which the agreement in no way supersedes;

(d) Identification of all the parties to the agreement and their representatives;

(e) Zone sponsor’s explicit approval for the firm to receive the exemption under ORS 285C.409 on its qualifying facility;

(f) The sponsor’s statement as to the number of consecutive tax years that will comprise the period of exemption beginning after the facility is placed in service, such that this period is only seven such years, if the agreement says nothing to the contrary about it being eight or more years up to the 15-year maximum; and

(g) With respect to additional conditions or requirements by the zone sponsor under ORS 285C.403(2)(e) and (3)(c), either:

(A) Indication that the sponsor is not imposing or requesting any such condition or requirement; or

(B) Specification of any such condition or requirement, in accordance with OAR 123-668, including but not limited to standards and methods for demonstrating satisfaction of the condition or requirement.

(2) The agreement may be:

(a) Part of a broader accord involving parties other than the firm and the sponsor, insofar as such an accord contains and cites the elements listed in section (1) of this rule.

(b) Preapproved, directly sanctioned by resolution or approved by other means of the zone sponsor, or of each cosponsor, consistent with OAR 123-668-2400.

(3) An authorized representative or representatives of the firm and of the zone sponsor or of each cosponsor must execute the agreement:

(a) On or after the effective date on which:

(A) The zone is designated or the facility site is amended into the zone through a change in the boundary of the zone; and

(B) The county containing the facility site is officially determined to conform with ORS 285C.400(3) consistent with OAR 123-690-0500; and

(b) Effectively before:

(A) The zone has terminated; and

(B) The county is not subject to a positive official determination as described in paragraph (a)(B) of this section.

(4) The sponsor shall provide a copy of the signed and dated written agreement to the Department, which shall review the agreement, and if the following are accurate, the Department shall issue a letter for attachment to the written agreement confirming that:

(a) On the date of its execution it effectively satisfied section (3) of this rule, and one party to the agreement is the sponsor of the rural enterprise zone; and

(b) The agreement appears to satisfy section (1) of this rule.

(5) Following the certification of the business firm as described in OAR 123-690-2400 or an effective date in subsection (3)(b) of this rule, the agreement may not be substantially modified, replaced, amended, supplemented or terminated, except as describe in section (7) of this rule.

(6) The agreement shall explicitly provide for the repercussions of failure to satisfy any additional condition or requirement, such that the business firm expressively acknowledges that the particular noncompliance would result in either retroactive disqualification of the exemption, termination of the remaining exemption period, or an alternative consequence.

(7) In relation to subsection (1)(f) of this rule, the agreement may provide based on the business firm's fulfillment of a local additional condition or criteria that:

(a) It terminates or expires prematurely, causing the exemption period to terminate before the time specified, such that the firm does not henceforth need to further comply with any statutory or local additional requirement.

(b) The exemption period extends a certain number of years beyond the time specified, but not more than 15 years in total.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.403, 285C.406 & 285C409
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-2100

Resolutions

For purposes of resolutions adopted by sponsoring or other local governments:

(1) A criterion for certification is adoption of a resolution approving the exemption for the facility by the county and by any city in which the facility is located under ORS 285C.403(3)(a), such that:

(a) Both the county and the city must adopt the resolution if any part of the facility is located in incorporated territory, but only the county, if the facility is located entirely in unincorporated territory;

(b) If the county or city is the sponsor or a cosponsor of the zone, any authorization or approval of a written agreement described in OAR 123-690-2000 by formal resolution of its governing body automatically fulfills this criterion for that city/county; and

(c) If such a county or city is neither the sponsor nor a cosponsor, it may nevertheless be a party to the written agreement in accordance with OAR 123-690-2000(2), but this criterion necessitating adoption of a formal resolution remains in effect.

(2) Adoption may occur at any time respective to execution of the agreement or an effective date in OAR 123-690-2000(3). If, however, the resolution substantially implements or provides for all or part of the agreement by the zone sponsor, as opposed to merely authorizing an otherwise operable agreement, then in order to certify the business firm, adoption of the resolution must occur after the agreement’s execution and before the zone’s termination.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.403
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-2300

Applying for Certification

For purposes of the application for certification under ORS 285C.403(1) and (2):

(1) In order for a business firm to receive the exemption on its facility under ORS 285C.409:

(a) The firm must do the following before hiring new employees at the proposed facility and before commencing any physical work on the facility, such as construction, reconstruction, additions, modifications or installations of any qualifying property or improvements:

(A) Fill out the latest revision of the Department of Revenue form 150-310-073, Certification Application: Long-Term Rural Oregon Tax Incentive, as completely as the firm is capable of doing;

(B) Have the form signed and dated by the owner or authorized representative of the firm;

(C) Submit a signed original of the form to either the local zone manager representing the sponsor of the enterprise zone or the county assessor of the county in which the facility is located; and

(D) Submit an executed copy of the form to either the local zone manager or the county assessor, whichever one does not receive the signed original.

(b) Submission of the application form as described in subsection (a) of this section must occur, with respect to the rural enterprise zone:

(A) On or after the effective date of the zone’s designation or of a change to the zone boundary adding the facility site; and

(B) Before the effective date of the zone’s termination.

(2) Submission of the application form may occur before or after any relevant resolution, commitment, written agreement or effective date of official determination for the zone’s eligibility.

(3) Estimated numbers, anticipated dates or other expectations as indicated in the application form are not binding. The business firm shall base them on the best and most current information available to it at the time and shall inform the local zone manager and county assessor in writing of any significant changes to such expectations.

(4) The commitments made by the business firm (as required in the application form or otherwise during the certification process) shall be accepted at face value for purposes of certifying the firm, but such a commitment shall not relieve the firm of actually needing to meet any applicable requirement under ORS 285C.400 to 285C.420 and 307.124 to 307.131.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.403
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-2400

Certification

For purposes of ORS 285C.403(3) to (6), following submission of the application for certification as described in OAR 123-690-2300:

(1) The signatures of the local zone manager and county assessor approving the certification application are not valid if either one occurs:

(a) After any part of the facility is in service;

(b) After the operational sunset date prescribed under ORS 285C.406(2)(a); or

(c) Before any of the following (unless formally reaffirmed afterwards):

(A) The commitments by the firm in the application to meet requirements under ORS 285C.412;

(B) The relevant written agreement and the corresponding letter of confirmation by the Department as described in OAR 123-690-2000;

(C) Any resolution by the sponsor or a cosponsor of the zone that authorizes or effects the written agreement in paragraph (B) of this subsection; or

(D) The requisite resolution or resolutions under ORS 285C.403(3)(a) by the county/city in which the facility is located.

(2) Approval of the certification application may occur after:

(a) The effective date of the termination of the enterprise zone; or

(b) Commencement of applicable hiring or physical work at or for the facility.

(3) Except as qualified in this rule and OAR 123-690-5200(2), the local zone manager and the county assessor shall approve the certification application upon satisfaction of the criteria under ORS 285C403(3), at which point:

(a) The business firm is “certified,” such that it is eligible for the exemption under ORS 285C.409(1)(a); and

(b) The zone manager and assessor shall send copies of the signed original certification application form with all relevant attachments to the firm, the Department and the Department of Revenue.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.403, 285C.406, 285C.409 & 285C.412
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

Mandatory Facility Criteria

123-690-4000

Minimum Size of Investment

For purposes of the minimum investment in the facility under ORS 285C.412(1)(a), (2)(a), (3)(a), (4)(b) or (5)(a) to be made by a certified business firm:

(1) Relevant investment costs for meeting the minimum shall include only expenses documentable through existing records or retrospective compilation of evidence and incurred in association with property owned or leased by the firm that is part of the facility, for the following:

(a) Construction, reconstruction, modification or installation of such property, including but not limited to materials, supplies, labor, building contractors, engineering, physical connections to utilities, on-site development, and so forth; or

(b) Purchase of any such property. (Current fair market value substitutes for purchase price in the case of property not subject to a recent sales transaction, such as items newly moved or transferred to the facility site and already owned or leased by the firm)

(2) Regardless of association with the facility or property, relevant investment costs do not include:

(a) Cost of financing, public permits or service charges, legal fees, the value of the firm’s own management, expenses to maintain finished property, and so forth;

(b) Cost or value of property that at the time of certification is already owned or leased by the firm and located at the facility site; or

(c) Expenses associated with purchases or with construction, reconstruction, modifications or installations of property that are incurred after December 31 of the year when the facility is placed in service.

(3) The firm shall provide evidence to the assessor in writing when this requirement is satisfied as soon as possible after such satisfaction is verifiable.

(4) Property excluded by this rule does not necessarily affect what property may be exempt under ORS 285C.409, which depends on its being part of the qualifying facility as defined in OAR 123-690-0100.

(5) In determining ‘real market value of all nonexempt taxable property in the county,’ the figure for the most recently available fiscal year shall be used, as printed in the latest edition of “Oregon Property Tax Statistics” (150-303-405) that is available from the Department of Revenue at the time of certification.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.412 & 285C.415
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-4200

Minimum Hiring

For purposes of the minimum hiring and employment to be met and maintained at an exempt facility under ORS 285C.412(1)(b), (2)(c), (3)(d), (4)(d) or (5)(c) by a certified business firm:

(1) Employees are persons each working directly or indirectly for the firm:

(a) More than 32 hours per week in an established, year-round position (as opposed to any form of averaging hours worked, such as full-time equivalency);

(b) Only in newly created jobs (as opposed to those associated with a merger or acquisition of another firm or existing facility operations); and

(c) Who are selected and directly managed by the business firm, an affiliated company, or a third party fully charged with general facility operations (as opposed to workers with independent contractors or vendors providing discrete services to the facility).

(2) Twelve months prior to when the facility is placed in service, the firm shall establish and make available information as regards the total number of employees as described in section (1) of this rule, each of whose job is located and performed:

(a) At the facility site; and

(b) Within the state as a whole other than at the facility site.

(3) The following satisfies minimum requirements:

(a) The number of employees located and performing their jobs at the facility site, less the corresponding number of employees per subsection (2)(a), equals or exceeds the respective minimum; and

(b) The number of employees of the firm in the state as a whole other than at the facility site is the same or greater than the corresponding number of employees per subsection (2)(b) of this rule, except for any decrease documented as entirely unrelated to new facility operations.

(4) The firm shall provide evidence to the assessor in writing when section (3) of this rule is satisfied, as soon as possible after such satisfaction is achieved, which:

(a) For subsection (3)(a) of this rule, must occur on or before December 31 not more than the following number of years after December 31 of the year in which the facility is first in service:

(A) Five years for ORS 285C.412(1) or (4); or

(B) Three years for ORS 285C.412(2), (3) or (5).

(b) For subsection (3)(b) of this rule, must occur at the same time when the assessor is notified that the applicable requirement in subsection (a) is met.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.412 & 285C.415
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-4400

Minimum Distance from I–5

For purposes of the minimum distance from the facility of a certified business firm to Interstate Highway 5 (I-5) under ORS 285C.412(3)(b) or (5)(b):

(1) Measure the distance as:

(a) A straight line; and

(b) The shortest possible gap between any part of the facility site and a point along the median of the highway, regardless if that point is in this state or offers access on/off the highway.

(2) Exclude any spur or bypass such as I-105 or I-205.

(3) Round distances to the nearest whole number, such that an eligible location must be effectively farther than 10.4 miles from I-5.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.412 & 285C.415
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-4600

Minimum Average Annual Compensation

For purposes of the minimum average annual compensation to be met and maintained at an exempt facility under ORS 285C.412(1)(c), (2)(b), (3)(c), (4)(c) or (5)(d) by a certified business firm:

(1) The firm shall include total calendar-year remuneration that is:

(a) In the form of wages, salary, bonuses, commissions, shift differential, overtime pay, profit-sharing, paid vacation, or financial benefits such as life insurance, medical coverage or retirement plans, but excluding free meals, club membership, workplace amenities and so forth, or any benefit mandated by federal, state or local law; and

(b) Paid to any employee located and performing work directly or indirectly for the firm at the facility site, regardless of hours worked per week or the permanence of the employee’s position.

(2) For each job at the facility in which the employee works less than 40 hours per week or for less than the entire calendar year, the firm shall annualize the actual annual compensation described in section (1) of this rule, based on 1820 hours per year of actual time working on the job (see Department policy OBDD 112).

(3) The firm shall sum all employees’ total annual compensation under section (1) or (2) of this rule and divide the total by the number of applicable employees or positions to derive an average.

(4) On or before December 31 five years after the year, in which the facility is first in service, this computed average must equal or exceed 1.5 times the most recent average annual covered payroll per employee for all industries in the county containing the facility site, as then most recently published by the Employment Department.

(5) The firm shall provide evidence to the assessor in writing when section (4) of this rule is satisfied as soon as possible after such satisfaction is achieved.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.412 & 285C.415
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

Ongoing Compliance

123-690-5000

Maintaining Employment and Compensation

(1) After initial satisfaction of the minimum requirement for total employment or average annual compensation, the facility’s applicable employment or compensation may never be less than the mandatory minimum level, until after December 31 of the final year of the exemption period. Otherwise, the exemption is disqualified consistent with OAR 150-285C.420, including back taxes during construction under ORS 285C.409(1)(a) and (b).

(2) The mandatory minimum level for average annual compensation at the facility remains fixed, regardless of how much:

(a) The facility’s annual average compensation initially exceeded the county’s the applicable average annual wage level; or

(b) The county’s average annual wage subsequently changes during the exemption period.

(3) Notwithstanding section (1) of this rule, the facility’s applicable employment or compensation may fall below the mandatory minimum level under certain extenuating circumstances, including but not limited to the following:

(a) A natural disaster substantially disrupting the facility’s operations;

(b) Six or more months of severe economic troubles or military conflict significantly affecting the United States, other major foreign economies and the firm’s industry;

(c) Unforeseen coincidence of vacant positions at the facility, such as the case in which previously hired persons have died, voluntarily quit or been fired for cause; or

(d) Temporary curtailment in the operation of the facility lasting no longer than twelve months to undertake major repairs in response to mechanical breakdowns that are unusual and unexpected within normal engineering parameters and maintenance programming.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.412, 285C.415 & 285C.420
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-5200

Post-Certification Verification

Pursuant to certification as described in OAR 123-690-2400 for purposes of qualifying for and continuing to receive exemption under ORS 285C.409(1)(c):

(1) In order for a certified business firm’s facility to qualify, the firm shall submit written information to the county assessor (and to the zone sponsor, Department or Department of Revenue) as requested, including but not limited to easily understood documentation on the following:

(a) All property comprising the facility and its adherence to OAR 123-690-0100, as well as the ownership of any leased property at the facility and corresponding lease agreements;

(b) When and by what measures the facility is first in service; and

(c) When and how each applicable requirement under ORS 285C.412 is initially satisfied, including but not limited to notice required under ORS 285C.415.

(2) To verify compliance with section (1) of this rule and the applicable requirements under ORS 285C.412:

(a) The county assessor may arrange with the business firm in writing for certain methods and mechanisms, as a condition of the county assessor’s approval of the certification application.

(b) The written agreement under ORS 285C.403(3)(c) may contain such arrangements.

(3) Any lack of the arrangements described in section (2) of this rule does not relieve the business firm of the obligation to demonstrate its compliance with and satisfaction of any applicable requirement, as the assessor or Department of Revenue may demand.

(4) The Department shall prepare a worksheet, which is hereby incorporated and made part of these administrative rules by reference, in order for business firms to readily report recent facility employment and compensation for purposes of ongoing compliance under ORS 285C.412.

(5) The zone sponsor may annually request that all relevant business firms in its enterprise zone fill out and return the worksheet, in the absence of, in addition to or in lieu of arrangements in section (2) of this rule, such that:

(a) The sponsor shall specify a due date for its receipt at some point from April 1 through June 1 each year but never less than 60 days after sending the (annual) request;

(b) The sponsor shall also request corroborating evidence that it commits to keep in confidence and not release publicly, if the firm indicates that any such evidence is confidential, sensitive or the like;

(c) The sponsor shall share copies of returned worksheets with the Department and the county assessor, and with other relevant officials as appropriate; and

(d) The sponsor shall report the failure by any business firm to fulfill such a request to the Department and the county assessor, who under such circumstances may terminate the exemption with the immediately subsequent tax year.

(6) Pursuant to subsection (5)(d) of this rule, or if reasons exist to doubt reported information, the sponsor and county assessor may jointly send the business firm a further request by registered/certified mail. As clearly stated in this request, if the firm does not respond within 60 day with substantiation of its employment, compensation or other compliance issue under ORS 285C.412, then retroactive disqualification automatically takes effect under ORS 285C.420 based on the presumption of noncompliance.

(7) This rule does not pertain to any local additional condition or requirement, for which verification of compliance is solely the responsibility of the zone sponsor, based on arrangements under ORS 285C.403(3)(c) consistent with OAR 123-690-2000(1)(g).

[Publications: Publications referenced are available from the agency]

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.409, 285C.412, 285C.415 & 285C.420
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

Contingencies with Property Tax Exemption

123-690-6000

Other Enterprise Zone or Construction Exemptions

For purposes of the exemption under ORS 285C.409:

(1) An eligible business firm may seek and receive approval for authorization under ORS 285C.140 according to OAR 123-674, while applying for and being certified under ORS 285C.403, although the zone sponsor and business firm shall clarify and resolve the situation as soon as possible.

(2) However, any property exempted under ORS 285C.170 or 285C.175, whether in the same or another enterprise zone, may not concurrently or subsequently be exempt under any paragraph of ORS 285C.409(1).

(3) Property that is exempt under ORS 285C.409(1)(a) or (b) may not receive an exemption under ORS 285C.175, unless it is qualified property for which exemption would otherwise be allowed under ORS 285C.170 as described in OAR 123-674-6000.

(4) Property may be subject to exemption as otherwise allowed under ORS 307.330, without necessarily jeopardizing the exemption under ORS 285C.409(1)(c).

(5) This rule does not relieve a taxpayer of any requirement to timely file forms, evidence or notice with the county assessor for purposes of (or to reserve the taxpayer’s right to) an exemption on property under ORS 285C.170 or 307.330 and 307.340, as well as 285C.409.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 285C.403, 285C.409 & 285C.420
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-6200

Subsequent Facility Investments

For real or personal property described in OAR 123-690-0100 but newly located, completed and placed in service at the facility site on or after the January 1 “assessment date” cited in ORS 285C.409(1)(c):

(1) Any such property is subject to the exemption but only for the remainder of the 7 to 15 tax years available, and neither additional operations nor the introduction of such property at the facility shall lengthen or add to the period of exemption on that or any property.

(2) A certified business firm may receive another (potentially overlapping) period of exemption affecting additional property at the same location, but only if independent of the respective actions and investments pertaining to the certification or qualification of a previously granted exemption, the firm again:

(a) Applies and receives approval for certification;

(b) Meets relevant criteria;

(c) Satisfies the applicable requirements to qualify for the exemption under ORS 285C.412; and

(d) Undertakes additional operations at the facility.

(3)(a) Additional property of a business firm certified for purposes of section (2) of this rule may be subject to exemption in accordance with section (1) of this rule until the earlier of:

(A) Final notice under ORS 285C.415 to the county assessor that all applicable requirements under ORS 285C.412 have been met for the new/additional facility investments; or

(B) The underlying/preexisting exemption expires (on June 30), and the certified business firm has not requested in writing that the assessor treat the additional property as a part of the exemption that is expiring.

(b) Upon fulfillment of either paragraph (a)(A) or (B) of this section, the additional property stays exempt until the end of its own period of exemption, but it is subject to the operation of ORS 285C.420 (retroactive disqualification for failure to meet or maintain an applicable requirement).

(c) The property is subject to (only) the original, remaining period of exemption if there is:

(A) No notice in paragraph (a)(A) of this section; and

(B) A timely formal request in paragraph (a)(B) of this section.

Stat. Auth.: ORS 285A.075 & 285C.060(1)
Stats. Implemented: ORS 285C.403, 285C.409 & 285C.412
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

Corporate Payroll Tax Credit

123-690-8000

Request for State Tax Credit

For purposes of approval for a business firm to receive the credit under ORS 317.124(3), to offset state corporate excise tax liabilities, unless otherwise directed by the Governor or by the Director:

(1) A request for the credit shall be formally submitted to the Director from an authorized executive of the corporation, preferably pursuant to relevant local approval and certification under ORS 285C.403.

(2) Official consideration of the request shall happen only after certification.

(3) The request must explicitly indicate:

(a) That the corporation is seeking gubernatorial approval;

(b) When it would expect to begin claiming such credits; and

(c) Any preferred length of time during for which credits may be claimable.

(4) The request shall contain the best possible information about the corporation’s future income and plans to use the credit, as necessary to estimate the value and applicability of the tax credit.

(5) The Director will forward the request to the Governor, which may be accompanied by a recommendation, and as warranted, by the following:

(a) Background information and analysis about the corporation, the proposed facility, tax impacts, the local community and so forth; and

(b) Summary of consultations with other state agencies including but not limited to the Department of Revenue.

(6) Approval of the request may be conditioned on additional commitments by the corporation as contained in any form of agreement or arrangement between the State and the business firm.

(7) The following is exempt from public release under ORS 192.502 and other laws:

(a) Any information received through the corporation as described in section (4) of this rule; and

(b) The request and any other information associated with it, whether drafted by the Department or otherwise generated, unless and until the Governor has approved the request, thereby deeming such information final.

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 317.124
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-8100

Excise/income Tax Credit

(1) To be effective, the Governor’s approval of a corporate excise or income tax credit under ORS 317.124 may take the form of a letter, memo or similarly official document that:

(a) Names the corporation and refers to its qualifying facility;

(b) Simply grants the tax credit, approves the corporation’s request or directs necessary action by State officials;

(c) Defines the length of the period during which the tax credits may be claimed; and

(d) Is done and effective by the ultimate due date (including normal extensions) to file a tax return for the corporation’s fourth income/excise tax year, in which the facility is in service.

(2) To claim the tax credit, certification must occur on or before the operational sunset date prescribed under ORS 285C.406(2)(b), and the certified business firm:

(a) Must generally own the facility and not lease it from other than a commonly owned company; and

(b) Shall fill out the latest revision of the Department of Revenue form 150-102-043, Long-Term Enterprise Zone Facilities Credit, and submit it with the tax return for each applicable income/excise tax year of the corporation, starting no later than the final year prescribed under ORS 317.124(3)(a).

Stat. Auth.: ORS 285A.075
Stats. Implemented: ORS 317.124
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

123-690-8500

Revenue Distribution to Local Zone Sponsor

(1) As noted in OAR 123-668-1600, the sponsor of an enterprise zone containing the facility of a corporation that claims the tax credit under ORS 317.124 might receive funds through the Department of Revenue from the Long Term Enterprise Zone Fund established under ORS 317.127.

(2) The sponsor’s receipt of such funds depends on:

(a) The qualifying taxpayer’s having claimed the credit;

(b) The taxpayer’s making applicable tax payments; and

(c) The depositing of amounts from such payments for distribution under ORS 317.129 and 317.131.

(3) As to the amounts for distribution and the current state fiscal year:

(a) If they exceed the property taxes that relevant taxing districts would otherwise have received in the corresponding property tax year, but for exemption under ORS 285C.409, then that excess goes to the zone sponsor.

(b) If there is no relevant exemption under ORS 285C.409 in the corresponding property tax year, then the entire amount goes to the zone sponsor.

(4) For purposes of section (3) of this rule, the zone sponsor is responsible for making timely arrangements, so that it:

(a) Can receive distributed funds in a way that effectively ensures the Department of Revenue of having made payment to the zone sponsor (including but not limited to a joint mechanism for all cosponsors, or through a deposit account administered by a single cosponsor on behalf of the entire zone sponsorship); and

(b) Satisfies applicable provisions of ORS Chapter 294 and other state or local laws with regard to collecting, holding and using such funds.

Stat. Auth.: ORS 285A.075 & 285C.060(1)
Stats. Implemented: ORS 317.131
Hist.: OBDD 29-2010, f. & cert. ef. 6-14-10

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